Individual Investors Do Well Safe Havens Help Little Guy Beat Pros

Individual investors have held their losses to only 1.8 percent since the stock market peaked on Jan. 2, according to Money magazine`s Small Investor Index.

In contrast, the blue-chip stocks held by most professional money managers have lost an average of 5.9 percent, even after counting reinvested dividends.

Last week, the index, which tracks the performance of the average individual`s investments, rose $256 to $41,507. Stocks provided almost all of the gain, rising $247.

Small investors have outperformed the Standard and Poors 500-stock index by staying diversified. They also are making smart moves out of risky assets, such as taking money out of growth stocks and junk bonds, and putting it into conservative investments, such as high-yield stocks and municipal bonds.

Individuals withdrew $1.3 billion from growth-oriented mutual funds in January, according to the Investment Company Institute, a trade group. Further, most fund groups report that the flight from growth funds accelerated in February. As stock prices have fallen in the past two months, such funds have lost 5.8 percent.

Similarly, investors pulled $657 million from high-risk junk-bond mutual funds in January and continued making large withdrawals in February as the prices of those bonds fell 3.5 percent.

The investments by individuals fared better. Municipal bond funds, for instance, which took in net investments of more than $1 billion in January and at least another $1 billion in February, gained one-half of 1 percent during the past two months.

And individuals` favorite category, risk-free money-market mutual funds, has been earning an annualized 8 percent. Small investors poured $21.4 billion in fresh cash into taxable and tax-exempt money funds in January and continued to add tens of billions more in February.

SMALL INVESTORS

Base: 100 (EQ) Dec. 31, 1989

Base Portfolio: $41,883

Current Portfolio Value: $41,507

This Week Year % Change from a

Week Ago Ago Week Ago Year Ago

98.84 98.23 89.22 +0.62% +10.78%

Latest Changes for Each Asset

% Change from a

Index Week ago Year ago

Stocks

NYSE 95.52 +2.28% +18.75%

ASE/OTC 94.94 +1.05 +6.13

Equity funds 96.22 +0.96 +11.75

Bonds

Taxable bonds 98.63 -0.04 +11.33

Municipals 101.47. +0.07 +10.65

Bond funds 97.93 +0.01 +5.02

Cash

CDs 101.33 +0.15 +8.51

Cash 101.02 +0.11 +6.17

Other

Real estate 100.15 +0.14 +5.89

Gold 99.78 -4.52 +22.55

The Money Small Investor Allocations: percentage of portfolio in each asset: